Norway does still not have enough gas in the Barents Sea for the extension of its gas pipeline grid to the region.(Photo: Øyvind Sætre, Gassco)
Gas from the Barents Sea might become a crucial part of Norwegian energy exports. But resources are still insufficient for the development of a major gas pipeline infrastructure in the area, a new report concludes.
”The Barents Sea is the next horizon in the development of the natural gas on the Norwegian continental shelf”, the report titled ”Barents Sea Gas Infrastructure” reads.
The report, which is written by Norwegian gas pipeline company Gassco together with a forum of 26 oil and gas companies, argues that the region has the resource potential to play a key role in sustaining Norway’s gas production during the 2020s and beyond.
However, the resources are still too meager for a major gas infrastructure development in the area. ”Existing discoveries are not sufficient to justify investment in new gas infrastructure from the Barents Sea, both from a post- and pre-tax perspective”, the authors conclude. Still, they do not exclude that a regional pipeline grid later could become viable, at least if the companies cooperate across the licenses.
Ultimately, infrastructure developments in the Arctic region will depend on decisions taken in Norwegian government corridors. Commenting on the report, Minister of Oil and Energy Tord Lien says in a press release that the document shows ”an exciting range of opportunities for expanded gas production and industrial developments in the Barents Sea” and that it ”again confirms the key importance of northern Norway in long-term positive development of our petroleum sector”.
The minister has several strong supporters in the northern part of the country. Among them is Johan Petter Barlindhaug, Board Director of regional oil company North Energy. Mr Barlindhaug believes that Norway’s oil and gas production can be boosted by as much as 50 percent by year 2030 if the potential of the country’s Arctic shelf is exploited. “This is not a dream, it can become reality, and Europe needs the gas”, he told BarentsObserver. Among the promising yet-to-be explored areas in the region are waters of the Hjalmar Johansen High, the area located on both sides of the Norwegian-Russian marine border.